EUR/USD registers biggest quarterly drop since Q2 2018


  • EUR/USD fell more than 4% in the third quarter.
  • That is the biggest quarterly drop since the second quarter of 2018.
  • The focus is on the preliminary Eurozone inflation data for September. 

EUR/USD is operating on slippery grounds, having registered the biggest quarterly drop in over a year in the third quarter of 2019. 

The currency pair closed at 1.0885 on Monday, representing a 4.14% drop from July 1st opening rate of 1.1360. 

That is the biggest quarterly decline since the second quarter of 2018. Back then, the common currency had dropped by 5.19%. 

The latest quarterly drop could be associated with the German recession fears and the dovish European Central Bank (ECB) expectations. The central bank cut rates by 10 basis points to -0.50% last month and is scheduled to restart bond purchases from Nov. 1st. 

Focus on Eurozone CPI

The Eurozone Consumer Price Index (CPI) scheduled for release at 09:00 GMT is expected to show the cost of living in the currency bloc rose by 1% year-on-year in September.

Oil prices spiked in September due to an attack on Saudi oil facilities. As a result, the headline CPI may beat estimates. The rise in inflation due to transient factors like oil price rally is unlikely to deter the ECB from easing. Hence, an above-forecast CPI may not put a bid under the EUR. 

The common currency, however, could regain some poise if the core inflation number beats estimates. 

Apart from the Eurozone inflation data, the pair may also take cues from the final September Purchasing Managers’ Indices scheduled for release across the Eurozone

As of writing, the pair is trading at 1.0888. The technical bias is bearish with the 5 and 10-day moving averages trending south and the 14-day relative strength reporting a below-50 reading. Also, the daily chart is reporting a bearish lower highs, lower lows setup. 

Technical levels

EUR/USD

Overview
Today last price 1.0888
Today Daily Change -0.0011
Today Daily Change % -0.10
Today daily open 1.0899
 
Trends
Daily SMA20 1.101
Daily SMA50 1.1076
Daily SMA100 1.1161
Daily SMA200 1.1241
 
Levels
Previous Daily High 1.0948
Previous Daily Low 1.0885
Previous Weekly High 1.1026
Previous Weekly Low 1.0905
Previous Monthly High 1.111
Previous Monthly Low 1.0885
Daily Fibonacci 38.2% 1.0909
Daily Fibonacci 61.8% 1.0924
Daily Pivot Point S1 1.0874
Daily Pivot Point S2 1.0849
Daily Pivot Point S3 1.0812
Daily Pivot Point R1 1.0936
Daily Pivot Point R2 1.0973
Daily Pivot Point R3 1.0999

 


 

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